Winners of AI spending mania won’t necessarily be the innovators

Drilling down on the artificial intelligence (AI) investment story is becoming critical as stock markets find excuses for ever greater enthusiasm. Any little story with an AI theme is driving up stock prices, assisted by the billions pledged for the building of data centres to handle all of our future searches.

The share price of Fanuc, a Japanese robotic company, jumped 9 per cent on the opening bell on Tuesday after it announced a tie-up with AI darling Nvidia. AI is likely to be a great tool, but the market is currently borrowing performance, revenues and profits from the future, much the same as it did in the dotcom bubble of 2000.

AI is under heavy scrutiny at the moment, partly because people are looking ahead and seeing a time when many jobs will disappear. We can look to the history of the Industrial Revolution and see that some new roles are likely to appear after the short-term pain. Indeed, some companies are already trying to shed labour even though AI customer service is barely a work in progress.